FIFE COUNCIL has confirmed an 8.2 per cent hike in council tax from April.
The Labour administration said the "significant increase" was painful but necessary to pay for council services we all use.
An amendment tabled by the SNP, which included a smaller 6.4% rise, was defeated by 40 votes to 31.
Council leader and Labour councillor David Ross said: "We were originally considering a rise of 10% but we found ways of keeping this down.
"Fife is not unique in needing a council tax rise of this level.
"Across Scotland many local authorities, some today, are facing the need to increase council tax by 10% or similar.
"Fife already has one of the lower levels of council tax compared to other Scottish local authorities."
The general fund revenue budget was approved at a meeting of the council at Fife House in Glenrothes on Thursday.
As well as setting the council tax, it includes the administration's proposals to balance the books and where they'll invest, such as an extra £3.5m to fix roads.
They also said there will be £3.5m to replace vehicles in the council's ageing fleet, £13.1m for a new swimming pool in West Fife, money to tackle flooding and £100,000 for the Fife Coast and Countryside Trust.
However, the big hike in council tax means that householders in band D properties will see their bills rise by more than £100 a year, from £1,385 to £1,498.
This is almost two and a half times the rate of inflation, which stands at 3%.
Ross said they could have got away with a smaller rise if they didn't have to hand over £10m to help the Fife Health and Social Care Partnership out of a financial hole.
He said it was "one of the most challenging budgets the council has ever faced" and added: "We can’t rely on increased funding from the Scottish Government so the only major source of funding we have in our own control is the council tax.
"We are well aware the impact that raising council tax has on families and individuals, when they already face many other personal financial pressures, but we all rely on the vital services provided by local government.
"And those that rely on them most are the least well off and the most vulnerable so we must strike a balance between making savings, protecting services and setting a realistic level of council tax that will sustain our services over the mid to long-term."
Labour said they faced a budget gap - between the cost of continuing the current level of services and the funding available - of £11.6m in 2025-26.
They believe it will stretch to £35m in 2026-27 and £61m by 2027-28, and said they'll need council tax rises of five per cent in each of those years.
To close the gap in the coming year they said they'd have to either cut expenditure, raise council tax or do a combination of both.
However, the SNP said the 8.2 rise in council tax, as well as five per cent in both of the next two years, would add up to a near 20 per cent hike.
Group leader, Cllr Craig Walker, said: "No one likes a council tax rise.
"We are all conscious of the pressure families are under, particularly in times of high inflation and increased cost of living.
"The reality we face is without a council tax increase many of the services that people depend on will be at risk.
"A 6.4 per cent increase allows us to continue delivering services while reducing the burden on families."
He called this a "more responsible and balanced approach" which would ensure "we are not passing on excessive costs to our residents while still maintaining the quality of the services".
Cllr Walker added that they could have pegged the council tax rise even lower, at 3.9 per cent, if Fife hadn't had to meet the unexpected rise in national insurance contributions that were imposed by the UK Government.
This time last year the Scottish Government offered councils money if they decided to freeze council tax.
The Labour group in Fife "reluctantly" agreed - it remained at £1,385 for band D properties in 2024-25 - and £14m was found to invest in services.
This year the government offered no such incentives.
